Mon September 24, 2012

Ads Slice Up Swing States With Growing Precision

Spend time watching TV in Colorado Springs, Colo., and you'll feel as though Mitt Romney and Barack Obama are King Kong and Godzilla, planted at the foot of the Front Range mountains for an epic fight that still has seven weeks to go. This city is home to fewer than half a million people, yet campaign spending here has tripled since 2008, landing it among the top 10 advertising markets in the country.

Colorado Springs provides a telling glimpse into the impact that political ads are having across the country in a year when the candidates and outside groups have blasted through every previous spending record.

Kyle Blakeley owns a local advertising company that bears his name. During campaign season four years ago, he went to a local TV news station and asked to buy a 30-second ad that would typically cost $300 to $500.

"They were talking to us about needing to pay $1,500 for that spot. But they had a national campaign come in at the last minute with some money and pay $7,000 for that spot," Blakeley says. That's 14 times the standard price.

"That's pretty typical," says political scientist Robin Kolodny. She studies campaign ad spending at Temple University in Philadelphia. "In 2006, when I did all the data gathering, a 30-second spot on the Philadelphia Eagles game was $65,000."

Broadcasters know there is a small window of time when they can charge a premium and campaigns will pay it. Campaigns have to get rid of their cash, because it will be useless the day after an election.

And those eye-popping examples are from past campaigns. This year everything is supersized — except for the number of swing states in play. So a bigger pot of money is getting pumped into a smaller pool of states.

A Focus On Second-Tier Ad Markets

"I've been someone who always sort of pooh-poohs 'this is the record year,' " says Ken Goldstein of Kantar Media, which tracks political ad spending. "But this really is a year when there is such focus on relatively few markets that the levels of advertising we're seeing are really uncharted waters."

Goldstein's firm did some research exclusively for NPR and PBS NewsHour. The data show that last week in Colorado Springs, political advertisers spent more than $300,000. That's three times what they spent during the same period in 2008. And the pattern is true of second-tier media markets across the country.

In Dayton, Ohio, since the beginning of the general election, ad spending has tripled compared with 2008.

In Cedar Rapids, Iowa, political advertisers have spent six times what they did in 2008.

In Richmond, Va., the increase is tenfold.

And the jump in these second-tier markets is much bigger than the national jump. Across the country, ad spending has about doubled since the last election. Even adjusting for the fact that fewer swing states are sharing a bigger pot of money, it seems that second-tier cities are getting much more attention than usual.

Colorado Springs is not an obvious place for all of this presidential action. Republicans outnumber Democrats in El Paso County more than 2 to 1. Barack Obama lost this part of Colorado to John McCain by 19 points in 2008.

"It's not a matter of just winning; it's winning by how much," says Rich Beeson, a fifth-generation Coloradan and political director for the Romney campaign.

Presidential campaigns know exactly the margin of victory or defeat that they have to hit in each town in order to carry an entire state. Democratic media strategist Tad Devine says campaigns set extremely specific goals based on hard data.

"Once those numbers, once the vote goals are developed, then the campaign sets out in a lot of different ways — at the grass-roots level, by organizing door to door, at the communications and advertising level, by broadcast media like television advertising — to achieve those goals."

Democrats Outspending Republicans

Although no one suggests that President Obama will win Colorado Springs, whether he loses it by 15 or 25 points could determine whether he carries Colorado.

Beeson of the Romney campaign says smaller cities are vital to this chess game, especially since they're cheaper to advertise in.

"A lot of secondary markets are very key to the overall map, whether it's a Charlottesville in Virginia or a Colorado Springs in Colorado," he says. "You can't ever cede the ground to anyone."

But in many swing states this year, Republicans have ceded ground to the Democrats.

Take Colorado. According to new research conducted for NPR and NewsHour by Kantar Media, last week the Romney campaign spent about $425,000 advertising in the state. The Obama campaign spent more than twice that amount. Outside Republican groups helped close the gap in Colorado a bit, but even factoring in all of the outside groups' political ads, Democrats outspent Republicans in the state last week by about 25 percent.

And that pattern of Democrats outspending Republicans has been true in other swing states, during other weeks.

All of this spending means that if you work at a local TV station in a swing state right now, you are very lucky and very busy.

At the local ABC affiliate in Denver, Missy Evanson can look at the polls on a Monday and predict how much her phone will be ringing for the rest of the week.

"The thing about a television station," she says, "it's a finite supply. This is classic economics, right? Supply and demand theory: I've got so many parking spots, it's a race to see who gets 'em."

Over the third quarter — June, July and August of this year — her station's ad revenues have doubled every month. And she says it's still growing exponentially.

"September will double August, and then ... in the month of October, in one month, we will have a million more dollars than what we had in the entire quarter."

Being 'More Creative' When The Circus Comes To Town

That extra money is not exactly a stimulus package for the community. It's a buffer that the stations count on for the off years, says Evanson.

"The very next year is extremely tough for us," she says. "The way that we will negotiate annual business and quarterly business next year is going to be a complete 180 from what we did this year."

If the newsroom wants a new satellite truck or camera equipment during an off year, station managers will say, "Wait until election season." That's a luxury of operating a TV station in a swing state. Stations in solidly red or blue states are out of luck.

But it can be tricky to count on the money coming in during an election, since the swing state map is always in flux. Pennsylvania was one of the most heavily contested states in 2008. This year, political ad spending is virtually nil there. North Carolina wasn't considered a swing state until Barack Obama squeaked out a win in 2008. Now it's one of the lucky few awash in millions of political advertising dollars. Wisconsin saw almost no political advertising early this year, but after Wisconsin Rep. Paul Ryan entered the race as Mitt Romney's running mate, both campaigns started spending there.

For local advertisers in Colorado Springs, this is a tougher time. When the clash of the titans plays out on your hometown airwaves, the local car dealership or furniture store has little choice but to run for cover.

"In a world of darkness, one man brought illumination to the people he loved," intones a voice at the start of an advertising video. The Colorado marketing firm Vladimir Jones created this spot for an energy client. It won't run on TV anytime soon, though. Instead, it's online.

Jon Bross, the media director for Vladimir Jones, says election season is always a test of his patience — and his flexibility. With TV rates skyrocketing, he has to look elsewhere.

"Digital, cable television are excellent alternatives. Print media only sees, for example, 5 percent of the political ad dollars, so that market is a little bit more open for us," he says. "You simply have to be more creative when the circus comes to town."

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

DAVID GREENE, HOST:

It's MORNING EDITION, from NPR News. Good morning. I'm David Greene.

STEVE INSKEEP, HOST:

And I'm Steve Inskeep.

This will be no surprise to people living in presidential swing states: Candidates have blasted through every previous record for spending on campaign ads.

GREENE: To measure how all that spending is affecting the country, we decided to focus on one community. Colorado Springs is home to fewer than half a million people, but in campaign season, it's often in the nation's top-10 advertising markets.

INSKEEP: So, metaphorically, think of NPR's Ari Shapiro like one of those reporters who stands on a beach in a hurricane. He spent last week around Colorado Springs, standing in a hurricane of TV messages, and has the first of two reports.

ARI SHAPIRO, BYLINE: Kyle Blakeley owns an advertising company in Colorado Springs. During campaign season four years ago, he wanted to place a 30-second spot on the local TV news. Typically, he'd have to pay three to $500. But the station said, sorry, this is campaign season. It's going to cost you.

KYLE BLAKELEY: They were talking to us about needing to pay $1,500 for that spot. But they had a national campaign come in at the last minute with some money and paid $7,000 for the spot.

SHAPIRO: For that one spot, the campaign paid 14 times the standard rate.

ROBIN KOLODNY: I think that's pretty typical.

SHAPIRO: Robin Kolodny is a political scientist at Temple University in Philadelphia. She says broadcasters know there's a small window when they can charge a premium, and campaigns will pay it. Campaigns have to get rid of their cash, because it'll be useless the day after an election.

KOLODNY: In 2006, when I did all the data-gathering, a 30-second spot on the Philadelphia Eagles game was $65,000.

SHAPIRO: And those eye-popping examples are from past campaigns. This year, everything is far bigger, except for the number of swing states in play, which is smaller.

Ken Goldstein is president of Kantar Media, which tracks political ad spending.

KEN GOLDSTEIN: And I've been someone who always sort of pooh-poohs this is the record year, but this really is a year where there is such focus on a relatively few markets, that the levels of advertising we're seeing are really, really uncharted waters.

SHAPIRO: Goldstein's firm did some research for NPR and PBS' "News Hour." It shows that last week in Colorado Springs, political advertisers spent three times more than they did during the same period in 2008. And that pattern is true of second-tier media markets across the country.

Take Dayton, Ohio. Since the beginning of the general election, ad spending there has tripled over 2008. It's jumped six-fold in Cedar Rapids, Iowa, and tenfold in Richmond, Virginia. And the jump in these second-tier markets is much bigger than the national jump. Across the country, ad spending has roughly doubled.

Colorado Springs is not an obvious place for all of this presidential action. Republicans outnumber Democrats in this county by more than two-to-one. In 2008, Barack Obama lost this part of Colorado by 19 points.

Rich Beeson is the Romney campaign's political director and a fifth-generation Coloradan.

RICH BEESON: It's not a matter of just winning. It's winning by how much.

SHAPIRO: Campaigns know exactly the margin of victory or defeat that they have to hit in each town in order to carry an entire state. Democratic media strategist Tad Devine says campaigns set extremely specific goals based on hard data.

TAD DEVINE: And once those numbers, once the vote goals are developed, then the campaign sets out in a lot of different ways at the grassroots level - by organizing door-to-door, at the communications and advertising level, by broadcasting media, like television advertising - to achieve those goals.

SHAPIRO: So everybody agrees that President Obama will lose Colorado Springs. But whether he loses it by 10 or 20 points could make the difference in whether he carries Colorado.

Beeson of the Romney campaign says smaller towns are vital to this chess game, especially since they're cheaper to advertise in.

BEESON: A lot of secondary markets are very key to the overall map, you know, whether it's, you know, Charlottesville in Virginia or Colorado Springs in Colorado, you can't ever cede the ground to anyone.

SHAPIRO: But in many swing states this year, Republicans have ceded advertising ground to the Democrats. Take Colorado. According to new research conducted for NPR and "The News Hour," last week, the Romney campaign spent about $425,000 on ads in the state. The Obama campaign spent more than twice that. Outside groups helped the Republicans close the gap, but still, when you factor all of that in, Democrats outspent Republicans last week in the state by about 25 percent. And that pattern has been true in other swing states, in other weeks.

All of this spending means if you work at a local TV station in a swing state right now, you are very lucky, and very busy.

Missy Evanson is sales director at the ABC affiliate in Denver.

MISSY EVANSON: The thing about a television station, it's finite supply. This is classic economics, right? Supply-and-demand theory. I've got so many parking spots. It's a race to see who gets them.

SHAPIRO: Over the third quarter - June, July and August of this year - her ad revenues have doubled every month.

EVANSON: September will double August, and then what that now tells us is in the month of October, in one month, we will have a million more dollars than what we had in the entire quarter, in third quarter.

SHAPIRO: That extra money is not exactly a stimulus package for the community. Evanson says it's a buffer for the off-years. The station counts on it.

EVANSON: Non-political years, the very next year is extremely tough for us. The way that we will negotiate annual business and quarterly business next year is going to be a complete 180 from what we did this year.

SHAPIRO: If the newsroom wants a new satellite truck or camera equipment during an off-year, station managers will say wait until election season. This flood of advertising cash has a bizarre effect on a place like Colorado Springs. It's as though King Kong and Godzilla are suddenly fighting on the streets of this town, and the local advertisers basically have no choice but to run for cover.

(SOUNDBITE OF ADVERTISEMENT)

UNIDENTIFIED MAN: In a world of darkness, one man brought illumination to the people he loved.

SHAPIRO: This is an ad that the Colorado advertising company Vladimir Jones created for a local energy client. It won't run on TV anytime soon. Instead, it's online. Jon Bross is the media director for Vladimir Jones. He says election season is always a test of his patience and his flexibility.

JON BROSS: Digital, cable television are excellent alternatives. Print media only sees, for example, 5 percent of the political ad dollars, so that market is a little bit more open for us. You simply have to be creative when the circus comes to town.

SHAPIRO: Of course, the purpose of all this political advertising is to sway voters. So what impact is it having on them? Tune into ALL THINGS CONSIDERED this afternoon for that story. Ari Shapiro, NPR News. Transcript provided by NPR, Copyright NPR.